Tuesday, June 16, 2009

Regulation of the U.S. financial sector

The current regulatory environment worldwide is one that demands that enterprises take every step to ensure the integrity of their finances, their data, their processes, and their employees. Legislators in virtually every nation have promulgated laws that mandate higher levels of corporate governance, risk management, and compliance. From the Sarbanes-Oxley Act (SOX) in the United States, to Bill 198 in Canada, to Japan’s Financial Instruments and Exchange Law (J-SOX) , to Saudi Arabia’s CMA Corporate Governance.

There is plan in the making at White house. The plan would bring sweeping changes to the way financial markets are overseen, empowering federal regulators and limiting the amount of risk financial companies can extend. It also would allow the government to take over and break up large firms, boost consumer protections and push for changes in the way loans are securitized.

Consultants stay tune ....


  1. In a world currently gripped with recession triggered mainly by corporate greed , regulations sound melody to ears-especially to the consulting industry. But we have to be alert to the flip side of it as well. Over-regulations may stifle productivity, innovation and entrepreneurship. That can never be good for the future of the world. On the other hand the smart crooks can ( and have) always managed to get around regulations. Constant vigilance is far more important than new regulations. Even if there are new regulations and lackadaisical vigilance, compliance with regulations would deteriorate to check-box formalities, where huge reports would be generated without adding anything to shareholder value or corporate responsibility.

  2. I guess you had news by Wednesday? Any news still?

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  4. The Sarbanes-Oxley Act affects public companies in the United States. Now similar legislation is affecting listed companies in China.

    On June 28, 2008, the Chinese Ministry of Finance, the China Securities Regulatory Commission, the National Audit Office, the China Banking Regulatory Commission, and the China Insurance Regulatory Commission jointly announced the Basic Standard for Enterprise Internal Control. This requires listed Chinese companies to comply from July 1, 2009 onward. Also described as “C-SOX,” the Basic Standard will require listed companies to make substantial changes to the way they control electronic information.